Medicare Program; Prohibition of Midyear Benefit Enhancements for Medicare Advantage Organizations, 43628-43632 [E8-17056]
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Federal Register / Vol. 73, No. 145 / Monday, July 28, 2008 / Rules and Regulations
E. Small Business Regulatory
Enforcement Fairness Act
Reporting To Congress—The Costs of
Operating Privately Owned Vehicles
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
This final rule is also exempt from
congressional review prescribed under 5
U.S.C. 801 since it relates solely to
agency management and personnel.
5 U.S.C. 5707(b)(1)(A) requires that
the Administrator of General Services,
in consultation with the Secretary of
Defense, the Secretary of
Transportation, and representatives of
Government employee organizations,
conduct periodic investigations of the
cost of travel and operation of privately
owned vehicles (airplanes, automobiles,
and motorcycles) to Government
employees while on official travel, and
report the results to the Congress at least
once a year. 5 U.S.C. 5707(a)(1) requires
that the Administrator of General
Services issue regulations prescribing
mileage reimbursement rates and
determine the average, actual cost per
mile for the use of each type of privately
owned vehicle based on the results of
these cost investigations. Such figures
must be reported to the Congress within
5 working days after the cost
determination has been made in
accordance with 5 U.S.C. 5707(b)(2)(C).
Pursuant to the above, the General
Services Administration (GSA), in
consultation with the above-specified
parties conducted investigations of the
cost of operating privately owned
vehicles. As provided in 5 U.S.C.
5704(a)(1), the privately owned
automobile (POA) reimbursement rate
cannot exceed the single standard
mileage rate established by the Internal
Revenue Service (IRS). The IRS
announced a new single standard
mileage rate for a POA of $0.585, which
was effective July 1, 2008 through
December 31, 2008. As required, GSA is
reporting the results of GSA’s
investigation and the cost per mile
determination. Based on cost studies
conducted by GSA, the Acting
Administrator of General Services has
determined the per-mile operating costs
of a POA to be $0.585. In addition, the
Acting Administrator of General Service
has determined the per-mile operating
costs of a privately owned airplane to be
$1.26, and the per-mile operating costs
of a privately owned motorcycle to be
$0.585.
Centers for Medicare & Medicaid
Services
List of Subjects in 41 CFR Part 301–10
Government employees, Travel and
transportation expenses.
Dated: July 11, 2008.
David L. Bibb,
Acting Administrator of General Services.
For the reasons set forth in the
preamble, under 5 U.S.C. 5701–5709,
GSA amends 41 CFR part 301–10 as set
forth below:
I
PART 301–10—TRANSPORTATION
EXPENSES
1. The authority citation for 41 CFR
part 301–10 continues to read as
follows:
I
Authority: 5 U.S.C. 5707, 40 U.S.C. 121(c);
49 U.S.C. 40118, Office of Management and
Budget Circular No. A–126, ‘‘Improving the
Management and Use of Government
Aircraft.’’ Revised April 28, 2006.
§ 301–10.303
[Amended]
2. In § 301–10.303, in the table, in the
second column, under the heading
‘‘Your reimbursement is’’, remove
‘‘1$1.07’’ and add ‘‘1$1.26’’ in its place;
remove ‘‘1$0.505’’ and insert ‘‘1$0.585’’
in its place; and remove ‘‘1$0.305’’ and
insert ‘‘1$0.585’’ in its place.
Note: The following attachment will
not appear in the Code of Federal
Regulations.
I
Attachment to Preamble
GENERAL SERVICES
ADMINISTRATION
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REPORTING TO CONGRESS—THE
COSTS OF OPERATING PRIVATELY
OWNED VEHICLES
Paragraph (b) of Section 5707 of Title
5, United States Code, requires the
Administrator of General Services to
periodically investigate the cost to
Government employees of operating
privately owned vehicles (airplanes,
automobiles, and motorcycles) while on
official travel, to report the results of the
investigations to Congress, and to
publish a report in the Federal Register.
The following report on the privately
owned vehicle mileage reimbursement
rates is published in the Federal
Register.
[FR Doc. E8–17183 Filed 7–25–08; 8:45 am]
BILLING CODE 6820–14–S
Dated: July 11, 2008.
David L. Bibb,
Acting Administrator of General Services.
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42 CFR Part 422
[CMS–4121–F]
RIN 0938–AO54
Medicare Program; Prohibition of
Midyear Benefit Enhancements for
Medicare Advantage Organizations
Centers for Medicare &
Medicaid Services (CMS), HHS.
ACTION: Final rule.
AGENCY:
SUMMARY: This final rule prohibits
Medicare Advantage (MA)
organizations, including organizations
offering MA plans to employer and
union group health plan sponsors, from
making midyear changes to nonprescription drug benefits, premiums,
and cost-sharing submitted in their
approved bids for a given contract year.
This final rule also clarifies that MA
organizations offering certain kinds of
plans restricted to employer and union
group health plan sponsors and not
open to general enrollment may
continue to offer benefit enhancements
as they do currently, through means
other than midyear benefit
enhancements (MYBEs). Programs of
all-inclusive care for elderly (PACE) are
not subject to the provisions of this final
rule and may continue to offer enhanced
benefits as specified in our guidance for
PACE plans.
DATES: Effective Date: These regulations
are effective on August 27, 2008.
FOR FURTHER INFORMATION CONTACT:
Christopher McClintick, (410) 786–
4682.
SUPPLEMENTARY INFORMATION:
I. Background
Title II of the Medicare Prescription
Drug, Improvement, and Modernization
Act of 2003 (MMA) (Pub. L. 108–173)
made important changes to the
Medicare+Choice (M+C) program under
Part C of Medicare and renamed the
program Medicare Advantage (MA). On
August 3, 2004, we published in the
Federal Register a proposed rule (69 FR
46866) that set forth the provisions that
would implement Title II of the MMA.
On January 28, 2005, we published in
the Federal Register a final rule (70 FR
4588) to implement our proposals. A
major revision to the MA program was
to implement a new bidding process for
determining benefits.
In the August 3, 2004 proposed rule,
we proposed to prohibit MA
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organizations from offering MYBEs (that
is, enhanced benefits or reductions in
premiums or cost-sharing amounts not
specified in the approved bid for the
calendar year (CY) in question). We
believed MYBEs undermined the
statutory requirement for a competitive
bidding process. In response to the
August 3, 2004 proposed rule, several
commenters objected to our proposal to
eliminate MYBEs. These commenters
believed that we could allow MYBEs
without affecting the integrity of the
bidding process.
In the January 28, 2005 final rule (70
FR 4639), we noted that under the
previous M+C program, we permitted
M+C organizations to offer new plans
midyear and to offer MYBEs to existing
benefit packages, but were concerned
that this was no longer appropriate
under the new bidding process. Also, in
the January 28, 2005 final rule (70 FR
4640), we noted that MYBEs ‘‘* * *
would be a de facto adjustment to the
benefit packages from which bids were
submitted earlier in the year.’’ In a
related final rule (published January 28,
2005 (70 FR 4301)) implementing the
Medicare prescription drug benefit (Part
D regulations), we similarly stated that
MYBEs ‘‘* * * would be de facto
acknowledgement that the revenue
requirements submitted by the plan
were overstated.’’ Although we
acknowledged that MYBEs could
undermine the integrity of the bidding
process, in response to comments on the
August 3, 2004 proposed rule, we
decided to permit them on an interim
basis under limited circumstances.
Therefore, in the January 28, 2005 final
rule, we stated that we would permit
MYBEs to non-drug benefits only as a
transitional policy and under the
following circumstances only:
• An MYBE could be effective no
earlier than July 1 of the contract year,
and no later than September 1 of the
contract year (in subsequent
instructions issued in a April 10, 2007
CMS memorandum, we further limited
the effective date to September 1);
• MA organizations could not submit
MYBE applications later than July 31 of
the contract year (in subsequent
instructions issued in an April 10, 2007
CMS memorandum, we further limited
the application date to June 30); and
• Twenty-five percent of the value of
the MYBE would be retained by the
government.
If the MYBE met the circumstances
described above, the requesting MA
organization—
• Was required to submit for each
plan or segment, a revised bid and any
supporting documentation related to the
enhancement, including information on
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where the revenue requirements were
overstated in the annual June bid
submission; and
• Would be subject to CMS
consideration of whether there is a
current year MYBE request when
analyzing a plan’s bid for the following
year.
On September 1, 2006, we published
in the Federal Register a proposed rule
(71 FR 52014–52017) that proposed
prohibiting MYBEs for all MA
organizations. For more information
concerning the basis of our proposal to
prohibit MYBEs, see the proposed rule
and our discussion of the proposed rule
in Section II of this document.
II. Provisions of the Proposed
Regulations
In the September 1, 2006 proposed
rule, we proposed to prohibit all MA
organizations from offering midyear
benefit enhancements. We are referring
the reader to 71 FR 52014–52017, for
more information concerning the basis
of our proposal to prohibit MYBEs.
III. Analysis of and Responses to Public
Comments
We received 4 items of timely
correspondence on the proposed rule,
raising 5 specific issues. The comments,
which we discuss below, were from an
individual, a health plan, and two
insurance trade organizations. We
reviewed each commenter’s letter and
for ease of reference, we are organizing
the comments and our responses to
them in the sections relating to MA
plans, and employer and union group
health plans, in general.
A. Medicare Advantage Plans
We proposed to prohibit MYBEs as
being inconsistent with the new, MMAauthorized, competitive bidding
process. We proposed that the new
prohibition would be effective
beginning contract year 2007. We
received comments concerning the
timeline for implementation of MYBEs,
and our contentions that MYBEs
encourage overbidding; that MYBEs are
inconsistent with the Part D benefit,
which does not permit MYBEs; and that
MYBEs can lead to an unfair advantage
for plans offering them. Some
commenters also stated that if we were
to prohibit MYBEs, we would be
affecting primarily beneficiaries who
would not have the opportunity to
receive additional benefits. See the
proposed rule for more information on
these issues.
Comment: A commenter stated that
current MYBE policy achieves a balance
between preserving the integrity of the
bidding process and providing enrollees
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with additional benefits at no extra
costs.
Response: We believe that
beneficiaries and the MA program in
general are best served by having a fair,
competitive, and transparent bidding
process. By prohibiting MYBEs we
believe that plans will have more
incentive to submit bids that reflect
actual revenue needs. Establishing a
level playing field and preserving the
integrity of the competitive bidding
process will be fair to plans and provide
beneficiaries with quality benefit
packages with reasonable costs.
Comment: Three commenters
recommended that CMS defer for a year
consideration of the policy to prohibit
MYBEs. The commenters’
recommendation for this request ranged
from the need to have more experience
with the bidding process, to the need to
take into account the fact that plans
would have little experience with the
bidding process and, therefore, would
need more time to make the transition
to the new process. One of the
commenters requested that if CMS
concludes a new policy is needed, it
should publish a new proposed rule.
Response: Based on these comments,
we delayed publication of the final rule,
which we had proposed to implement
beginning with the 2007 calendar year
(CY). While the additional year of
experience has been helpful for us in
assessing MYBEs, we believe that it
confirms a longer transition period will
not be necessary (only one MA
organization, for example, applied for a
MYBE in 2007). With respect to our
other primary concerns, we continue to
estimate that MYBEs would likely lead
to bids as much as 2 to 3 percent higher
than would be submitted if MYBEs were
prohibited, and that the competitive
nature of the bidding process would be
undermined to both the detriment of
beneficiaries and the MA program if
MYBEs were permitted even under the
current limitations. We also do not
believe that there is any benefit to
publishing another proposed rule.
Although this final rule updates some of
our original contentions, and clarifies
our discussion of employer and union
sponsored group health plans and
MYBEs, our concerns as well as our
means of addressing them remain
unchanged as does the larger context
surrounding MYBEs and the MA
program. We believe, therefore, that it is
important to proceed as indicated in the
proposed rule so that we may ensure
that the bidding process is competitive,
fair to all, and that it continues to
comply with the statute.
Comment: A commenter disagreed
with our statement that there was value
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in making the MA MYBE policy
consistent with the prescription drug
benefit program (which does not permit
MYBEs). The commenter also stated that
the offering of basic or supplemental
benefits in MA programs often have
separate requirements, and asked why
this should not be the case with respect
to MYBEs and Part C and D benefits. In
other words, the commenter asked why
would CMS prohibit MYBEs for MA
benefits simply because this is the case
for Part D benefits.
Response: As we stated in the
proposed rule, we do not believe that
non-prescription drug benefits should
be treated differently than prescription
drug benefits. In many MA plans
(known as MA–PDs), beneficiaries also
receive the Part D prescription drug
benefit. (Under our current guidance, in
such cases beneficiaries could receive
benefit enhancements for health benefits
midyear but no enhancements for the
Part D portion of the benefit.) By
prohibiting MYBEs we will create
consistency in treatment of the Part C
and D benefit components and ensure
that estimates of the revenue necessary
for both is accurate. In response to the
comment that the sometimes different
requirements surrounding Part C basic
and supplemental benefits would
permit different treatment of MA and
Part D benefits, (that is, allow MYBEs
for MA plans but not for Part D plans),
we believe that the different
requirements cited by the commenter
would have little to do with the
question of MYBEs and their relation to
bidding. Instead, the prohibition on
MYBEs is primarily due to our desire to
ensure that bids accurately represent the
revenue needed whether for MA basic
or supplemental benefits.
B. Employer and Union Group Health
Plans
In the January 28, 2005 final rule (70
FR 4639), we noted that under the
previous M+C program, we permitted
M+C organizations to offer MYBEs to
existing benefit packages (that is,
enhanced benefits, or reductions in
premiums or cost-sharing amounts). We
also noted that because employers and
unions offering group health plans
through an MA organization may
operate on different bidding and
negotiation timelines, MA organizations
offering certain kinds of restricted
enrollment plans to employer and union
group health plan sponsors would be
allowed to offer MYBEs on a flow basis
and would not be subject to the new
restrictions on MYBEs. This exemption
from the proposed MYBE restriction
included both the ‘‘800-series’’
employer and union-only group health
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plans and the new type of employer and
union group health plan, where we
directly contract with the employer or
union sponsor offering an MA product
(both of these restricted enrollment
employer-only plans have since become
known as employer and union-only
group waiver plans or ‘‘EGWPs’’). We
noted that we did not believe the
competitive nature of the bidding
process was affected if benefit packages
for these plans were adjusted midyear in
accordance with our guidance.
However, we noted that an MA
organization would be subject to the
policy of restricted MYBEs if it is
offering an employer or union group
health plan sponsor a plan that enrolls
both individual beneficiaries and
employer or union group health plan
members, (that is, a plan open to general
enrollment). For these latter plans, we
also noted that employers and unions
would still be free to enhance benefits
midyear for the part of the group health
plan benefit that is a ‘‘wrap-around’’ to
the MA plan and that is only available
to that employer or union group health
plan sponsor’s members. Additionally,
we noted that these ‘‘wrap-around’’
benefits are not technically part of the
MA plan.
In the September 1, 2006 proposed
rule (71 FR 52016), we noted that there
was no longer a need for an interim
MYBE policy and applied the same rule
to ‘‘800-series’’ EGWPs that was
proposed for all other MA plans (with
the exception of PACE plans). That is,
we proposed that beginning with CY
2007, all MA organizations, including
organizations offering MA plans to
employer and union group health plan
sponsors, would not be permitted to
make any midyear changes in benefits,
premiums or cost-sharing even under
the circumstances in which these types
of changes were permitted in CY 2006.
We proposed that this policy apply to
MA organizations that offer plans open
to general enrollment to employer and
union group health plan sponsors and
MA organizations that offer restricted
enrollment plans to employer and union
group health plan sponsors (that is,
‘‘800 series’’ EGWPs).
Comment: Two insurance trade
associations commented that the
proposed rule should not apply to
restricted enrollment MA plans. The
commenters stated that the proposed
rule would severely limit the
longstanding flexibility for MA
organizations and employers or unions
to negotiate benefits throughout the year
that are responsive to the needs and
interests of these employer and union
group health plan sponsors and their
members and thereby discourage
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employer and union health plan
sponsors from enrolling their members
in MA plans. The commenters also
indicated that it is crucial for MA plans
to be able to accommodate the timing of
arrangements with employers and
unions that offer ‘‘800-series’’ noncalendar year plans, and those ‘‘800series’’ plans and/or contracts that begin
midyear. For example, the commenters
stated that it would be extremely
difficult for MA organizations that must
submit a bid by June of each year to
anticipate the needs of employers who
have plan years that start in July of the
following year (for example, State and
local governments).
Response: We agree that MA
organizations should retain the
longstanding flexibility to customize
benefits, including enhancing benefits
and reducing premiums and costsharing, for all ‘‘800-series’’ EGWPs in
order to be able to accommodate the
various needs of employer and union
group health plan sponsors throughout
the year. The proposed prohibition on
MYBEs was not intended in any way to
limit the current flexibility that MA
organizations have to negotiate
customized benefit designs for these
‘‘800-series’’ employer and union-only
types of plans. The proposed rule was
merely intended to clarify that these
kinds of plans do not need to be
exempted from the policy restricting
MYBEs because, due to their unique
nature, they may continue to enhance
benefits for employer and union group
health plan sponsors at any point during
the contract year without submitting
MYBEs to CMS. Accordingly, we are
clarifying that MA organizations will
retain the flexibility to enhance benefits
when offering these kinds of ‘‘800series’’ employer and union-only plans
to employer and union group health
plan sponsors throughout the year
despite being restricted from filing a
formal MYBE with CMS. Filing an
MYBE is not necessary to exercise this
flexibility.
Also, we are further clarifying that
MA organizations will continue to be
able to accommodate different timing
arrangements for different employer or
union group health plan sponsors by
either contracting with employers and
unions on a non-calendar year basis or
by entering into new employer and
union contracts midyear. MA
organizations do not need to file MYBEs
to continue to negotiate with employers
or unions to provide enhanced benefits
on a non-calendar year basis or to enter
into midyear contracts with employer
and union group health plan sponsors.
Comment: One commenter expressed
concern that the MYBE prohibition may
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cause employer and union group health
plan sponsors to lose the ability to
incorporate Medicare in their benefits
and thereby negatively affect the ability
to reduce health care costs and
employers’ access to affordable health
care.
Response: CMS’ longstanding policy
allowing enhancement of ‘‘800 series’’
EGWP plans for employer and union
group health plan sponsors throughout
the year, as explained in response to the
previous comment, is not being
modified by the proposed rule. We are
clarifying that the proposed rule does
not limit the current flexibility for
employer and union group health plan
sponsors to continue to contract with
MA plans to offer employment-based
health coverage that incorporates
Medicare benefits (that is, ‘‘800-series’’
EGWPs) and thereby enhances the cost
effectiveness for employer and union
health plan sponsors and the retention
of employment-based coverage.
IV. Provisions of the Final Regulations
We are finalizing, with the
clarifications described in section III,
Analysis of and Responses to Public
Comments, the policy specified in the
September 1, 2006 proposed rule (71 FR
52014–52017) and section II, Provisions
of the Proposed Rule. Beginning in
contract year 2008, MA organizations
will no longer be permitted to offer
midyear benefit enhancements. As
discussed in section III of this rule,
employer and union group health plans
sponsors offering ‘‘800 series’’ MA plans
will continue to be able to offer benefit
enhancements as they do currently,
through means other than MYBEs under
existing CMS employer group waiver
policies. PACE plans are not affected by
the prohibition.
We have had the opportunity to
reevaluate our MYBE policy over the
course of the first 2 contract years of the
new bidding process, and we remain
convinced that MYBEs are an obstacle
to the statutory requirement of a
competitive bidding process and that
there is no longer a need for this interim
policy. As stated in the proposed rule
on September 1, 2006, this policy was
intended to assist MA organizations
during the initial phase of the new
bidding process, while ensuring that
beneficiaries have a choice of plans. The
lack of MYBE applications support this
conclusion as we had only one
application for a MYBE in CY 2007, and
approximately six in CY 2006. Under
the new bidding process, the focus is, as
it should be in a competitive
environment, on establishing a level
playing field by ensuring that the initial
bidding process is not skewed by the
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opportunity later in the year to adjust
benefits and bids through benefit
enhancements. Prohibiting MYBEs will
ensure that the focus is squarely on the
integrity of the bidding process
established by statute.
As indicated in the proposed rule, the
rationales for our proposal to prohibit
MYBEs remain valid after another year
of experience with MYBEs and the
bidding process. To summarize those
concerns—
• MA organizations, knowing that
they could alter their benefit packages
after the bidding process was complete,
could misrepresent their actual costs
(revenue requirements) to provide
benefits (overbid) and noncompetitively
revise their benefit packages later in the
year, once competitors’ benefits are
known.
• MYBEs offered in July or September
of the contract year could be offered
primarily to attract individuals in their
initial coverage election period (ICEP).
We believe that individuals are very
attractive to MA organizations because
of their relatively low utilization (they
are new to the program and tend to be
healthier) and because of their numbers
(nationally, over 200,000 individuals
per month ‘‘age-in’’ to Medicare).
• We estimate that organizations
planning on revising their bids through
MYBEs could overbid by as much as 2
to 3 percent in order to distinguish
themselves from other plans later in the
year and attract ICEP beneficiaries.
• MYBEs encourage overbidding, and
second, penalize MA organizations that
do not attempt to ‘‘game the system’’
and which instead offer a bid that more
accurately represents their costs to offer
benefits over the full course of a
contract year.
• MYBEs are not consistent with the
Part D program (the Part D program does
not allow MYBEs).
Finally, based on our experience since
permitting MYBEs under even the
current limited circumstances, we have
found it difficult to determine the
credibility of ‘‘excess’’ profits an MA
organization has for a specific plan (on
which MYBEs are based), since the
assessment is based only on a few
months of incomplete utilization data
that occur between the beginning of the
calendar year and the MYBE application
deadline. Therefore, based on comments
received, we are accepting all of the
provisions as proposed.
V. Collection of Information
Requirements
This document does not impose
information collection and
recordkeeping requirements.
Consequently, it need not be reviewed
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by the Office of Management and
Budget under the authority of the
Paperwork Reduction Act of 1995 (44
U.S.C. 35).
VI. Regulatory Impact Statement
We have examined the impact of this
rule as required by Executive Order
12866 (September 1993, Regulatory
Planning and Review), the Regulatory
Flexibility Act (RFA) (September 19,
1980, Pub. L. 96–354), section 1102(b) of
the Social Security Act, the Unfunded
Mandates Reform Act of 1995 (Pub. L.
104–4), and Executive Order 13132.
Executive Order 12866 directs
agencies to assess all costs and benefits
of available regulatory alternatives and,
if regulation is necessary, to select
regulatory approaches that maximize
net benefits (including potential
economic, environmental, public health
and safety effects, distributive impacts,
and equity). A regulatory impact
analysis (RIA) must be prepared for
major rules with economically
significant effects ($100 million or more
in any 1 year). This rule does not reach
the economic threshold and thus is not
considered a major rule.
The RFA requires agencies to analyze
options for regulatory relief of small
businesses. For purposes of the RFA,
small entities include small businesses,
nonprofit organizations, and small
governmental jurisdictions. Most
hospitals and most other providers and
suppliers are small entities, either by
nonprofit status or by having revenues
of $6 million to $29 million in any 1
year. Individuals and States are not
included in the definition of a small
entity. The MA program, by having both
regional and local plans, provides an
opportunity for health insurance entities
of all types and most sizes (but probably
not below the ‘‘small’’ insurance entity
cutoff level defined by the SBA ($6
million), which is lower than appears
viable for a comprehensive, risk-bearing
insurance plan) to participate.
Therefore, we are not preparing an
analysis for the RFA because we have
determined that this rule will not have
a significant economic impact on a
substantial number of small entities.
In addition, section 1102(b) of the Act
requires us to prepare a regulatory
impact analysis if a rule may have a
significant impact on the operations of
a substantial number of small rural
hospitals. This analysis must conform to
the provisions of section 603 of the
RFA. For purposes of section 1102(b) of
the Act, we define a small rural hospital
as a hospital that is located outside of
a Metropolitan Statistical Area and has
fewer than 100 beds. We are not
preparing an analysis for section 1102(b)
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of the Act because we have determined
that this rule will not have a significant
impact on the operations of a substantial
number of small rural hospitals.
Section 202 of the Unfunded
Mandates Reform Act of 1995 also
requires that agencies assess anticipated
costs and benefits before issuing any
rule whose mandates require spending
in any 1 year of $100 million in 1995
dollars, updated annually for inflation.
That threshold level is currently
approximately $120 million. This rule
will have no consequential effect on
State, local, or tribal governments or on
the private sector.
Executive Order 13132 establishes
certain requirements that an agency
must meet when it promulgates a
proposed rule (and subsequent final
rule) that imposes substantial direct
requirement costs on State and local
governments, preempts State law, or
otherwise has Federalism implications.
Since this regulation does not impose
any costs on State or local governments,
the requirements of E.O. 13132 are not
applicable.
In accordance with the provisions of
Executive Order 12866, this regulation
was reviewed by the Office of
Management and Budget.
(Catalog of Federal Domestic Assistance
Program No. 93.773, Medicare—Hospital
Insurance; and Program No. 93.774,
Medicare—Supplementary Medical
Insurance Program)
Dated: January 10, 2008.
Kerry Weems,
Acting Administrator, Centers for Medicare
& Medicaid Services.
Approved: March 12, 2008.
Michael O. Leavitt,
Secretary.
[FR Doc. E8–17056 Filed 7–25–08; 8:45 am]
BILLING CODE 4120–01–P
DEPARTMENT OF HOMELAND
SECURITY
Federal Emergency Management
Agency
44 CFR Part 64
[Docket No. FEMA–8033]
Suspension of Community Eligibility
Federal Emergency
Management Agency, DHS.
ACTION: Final rule.
rfrederick on PROD1PC67 with RULES
AGENCY:
SUMMARY: This rule identifies
communities, where the sale of flood
insurance has been authorized under
the National Flood Insurance Program
(NFIP), that are scheduled for
VerDate Aug<31>2005
14:01 Jul 25, 2008
Jkt 214001
suspension on the effective dates listed
within this rule because of
noncompliance with the floodplain
management requirements of the
program. If the Federal Emergency
Management Agency (FEMA) receives
documentation that the community has
adopted the required floodplain
management measures prior to the
effective suspension date given in this
rule, the suspension will not occur and
a notice of this will be provided by
publication in the Federal Register on a
subsequent date.
DATES: Effective Dates: The effective
date of each community’s scheduled
suspension is the third date (‘‘Susp.’’)
listed in the third column of the
following tables.
FOR FURTHER INFORMATION CONTACT: If
you want to determine whether a
particular community was suspended
on the suspension date or for further
information, contact David Stearrett,
Mitigation Directorate, Federal
Emergency Management Agency, 500 C
Street, SW., Washington, DC 20472,
(202) 646–2953.
SUPPLEMENTARY INFORMATION: The NFIP
enables property owners to purchase
flood insurance which is generally not
otherwise available. In return,
communities agree to adopt and
administer local floodplain management
aimed at protecting lives and new
construction from future flooding.
Section 1315 of the National Flood
Insurance Act of 1968, as amended, 42
U.S.C. 4022, prohibits flood insurance
coverage as authorized under the NFIP,
42 U.S.C. 4001 et seq., unless an
appropriate public body adopts
adequate floodplain management
measures with effective enforcement
measures. The communities listed in
this document no longer meet that
statutory requirement for compliance
with program regulations, 44 CFR part
59. Accordingly, the communities will
be suspended on the effective date in
the third column. As of that date, flood
insurance will no longer be available in
the community. However, some of these
communities may adopt and submit the
required documentation of legally
enforceable floodplain management
measures after this rule is published but
prior to the actual suspension date.
These communities will not be
suspended and will continue their
eligibility for the sale of insurance. A
notice withdrawing the suspension of
the communities will be published in
the Federal Register.
In addition, FEMA has identified the
Special Flood Hazard Areas (SFHAs) in
these communities by publishing a
Flood Insurance Rate Map (FIRM). The
PO 00000
Frm 00026
Fmt 4700
Sfmt 4700
date of the FIRM, if one has been
published, is indicated in the fourth
column of the table. No direct Federal
financial assistance (except assistance
pursuant to the Robert T. Stafford
Disaster Relief and Emergency
Assistance Act not in connection with a
flood) may legally be provided for
construction or acquisition of buildings
in identified SFHAs for communities
not participating in the NFIP and
identified for more than a year, on
FEMA’s initial flood insurance map of
the community as having flood-prone
areas (section 202(a) of the Flood
Disaster Protection Act of 1973, 42
U.S.C. 4106(a), as amended). This
prohibition against certain types of
Federal assistance becomes effective for
the communities listed on the date
shown in the last column. The
Administrator finds that notice and
public comment under 5 U.S.C. 553(b)
are impracticable and unnecessary
because communities listed in this final
rule have been adequately notified.
Each community receives 6-month,
90-day, and 30-day notification letters
addressed to the Chief Executive Officer
stating that the community will be
suspended unless the required
floodplain management measures are
met prior to the effective suspension
date. Since these notifications were
made, this final rule may take effect
within less than 30 days.
National Environmental Policy Act.
This rule is categorically excluded from
the requirements of 44 CFR part 10,
Environmental Considerations. No
environmental impact assessment has
been prepared.
Regulatory Flexibility Act. The
Administrator has determined that this
rule is exempt from the requirements of
the Regulatory Flexibility Act because
the National Flood Insurance Act of
1968, as amended, 42 U.S.C. 4022,
prohibits flood insurance coverage
unless an appropriate public body
adopts adequate floodplain management
measures with effective enforcement
measures. The communities listed no
longer comply with the statutory
requirements, and after the effective
date, flood insurance will no longer be
available in the communities unless
remedial action takes place.
Regulatory Classification. This final
rule is not a significant regulatory action
under the criteria of section 3(f) of
Executive Order 12866 of September 30,
1993, Regulatory Planning and Review,
58 FR 51735.
Executive Order 13132, Federalism.
This rule involves no policies that have
federalism implications under Executive
Order 13132.
E:\FR\FM\28JYR1.SGM
28JYR1
]]>Agencies
[Federal Register Volume 73, Number 145 (Monday, July 28, 2008)]
[Rules and Regulations]
[Pages 43628-43632]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-17056]
=======================================================================
-----------------------------------------------------------------------
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
42 CFR Part 422
[CMS-4121-F]
RIN 0938-AO54
Medicare Program; Prohibition of Midyear Benefit Enhancements for
Medicare Advantage Organizations
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This final rule prohibits Medicare Advantage (MA)
organizations, including organizations offering MA plans to employer
and union group health plan sponsors, from making midyear changes to
non-prescription drug benefits, premiums, and cost-sharing submitted in
their approved bids for a given contract year. This final rule also
clarifies that MA organizations offering certain kinds of plans
restricted to employer and union group health plan sponsors and not
open to general enrollment may continue to offer benefit enhancements
as they do currently, through means other than midyear benefit
enhancements (MYBEs). Programs of all-inclusive care for elderly (PACE)
are not subject to the provisions of this final rule and may continue
to offer enhanced benefits as specified in our guidance for PACE plans.
DATES: Effective Date: These regulations are effective on August 27,
2008.
FOR FURTHER INFORMATION CONTACT: Christopher McClintick, (410) 786-
4682.
SUPPLEMENTARY INFORMATION:
I. Background
Title II of the Medicare Prescription Drug, Improvement, and
Modernization Act of 2003 (MMA) (Pub. L. 108-173) made important
changes to the Medicare+Choice (M+C) program under Part C of Medicare
and renamed the program Medicare Advantage (MA). On August 3, 2004, we
published in the Federal Register a proposed rule (69 FR 46866) that
set forth the provisions that would implement Title II of the MMA. On
January 28, 2005, we published in the Federal Register a final rule (70
FR 4588) to implement our proposals. A major revision to the MA program
was to implement a new bidding process for determining benefits.
In the August 3, 2004 proposed rule, we proposed to prohibit MA
[[Page 43629]]
organizations from offering MYBEs (that is, enhanced benefits or
reductions in premiums or cost-sharing amounts not specified in the
approved bid for the calendar year (CY) in question). We believed MYBEs
undermined the statutory requirement for a competitive bidding process.
In response to the August 3, 2004 proposed rule, several commenters
objected to our proposal to eliminate MYBEs. These commenters believed
that we could allow MYBEs without affecting the integrity of the
bidding process.
In the January 28, 2005 final rule (70 FR 4639), we noted that
under the previous M+C program, we permitted M+C organizations to offer
new plans midyear and to offer MYBEs to existing benefit packages, but
were concerned that this was no longer appropriate under the new
bidding process. Also, in the January 28, 2005 final rule (70 FR 4640),
we noted that MYBEs ``* * * would be a de facto adjustment to the
benefit packages from which bids were submitted earlier in the year.''
In a related final rule (published January 28, 2005 (70 FR 4301))
implementing the Medicare prescription drug benefit (Part D
regulations), we similarly stated that MYBEs ``* * * would be de facto
acknowledgement that the revenue requirements submitted by the plan
were overstated.'' Although we acknowledged that MYBEs could undermine
the integrity of the bidding process, in response to comments on the
August 3, 2004 proposed rule, we decided to permit them on an interim
basis under limited circumstances. Therefore, in the January 28, 2005
final rule, we stated that we would permit MYBEs to non-drug benefits
only as a transitional policy and under the following circumstances
only:
An MYBE could be effective no earlier than July 1 of the
contract year, and no later than September 1 of the contract year (in
subsequent instructions issued in a April 10, 2007 CMS memorandum, we
further limited the effective date to September 1);
MA organizations could not submit MYBE applications later
than July 31 of the contract year (in subsequent instructions issued in
an April 10, 2007 CMS memorandum, we further limited the application
date to June 30); and
Twenty-five percent of the value of the MYBE would be
retained by the government.
If the MYBE met the circumstances described above, the requesting
MA organization--
Was required to submit for each plan or segment, a revised
bid and any supporting documentation related to the enhancement,
including information on where the revenue requirements were overstated
in the annual June bid submission; and
Would be subject to CMS consideration of whether there is
a current year MYBE request when analyzing a plan's bid for the
following year.
On September 1, 2006, we published in the Federal Register a
proposed rule (71 FR 52014-52017) that proposed prohibiting MYBEs for
all MA organizations. For more information concerning the basis of our
proposal to prohibit MYBEs, see the proposed rule and our discussion of
the proposed rule in Section II of this document.
II. Provisions of the Proposed Regulations
In the September 1, 2006 proposed rule, we proposed to prohibit all
MA organizations from offering midyear benefit enhancements. We are
referring the reader to 71 FR 52014-52017, for more information
concerning the basis of our proposal to prohibit MYBEs.
III. Analysis of and Responses to Public Comments
We received 4 items of timely correspondence on the proposed rule,
raising 5 specific issues. The comments, which we discuss below, were
from an individual, a health plan, and two insurance trade
organizations. We reviewed each commenter's letter and for ease of
reference, we are organizing the comments and our responses to them in
the sections relating to MA plans, and employer and union group health
plans, in general.
A. Medicare Advantage Plans
We proposed to prohibit MYBEs as being inconsistent with the new,
MMA-authorized, competitive bidding process. We proposed that the new
prohibition would be effective beginning contract year 2007. We
received comments concerning the timeline for implementation of MYBEs,
and our contentions that MYBEs encourage overbidding; that MYBEs are
inconsistent with the Part D benefit, which does not permit MYBEs; and
that MYBEs can lead to an unfair advantage for plans offering them.
Some commenters also stated that if we were to prohibit MYBEs, we would
be affecting primarily beneficiaries who would not have the opportunity
to receive additional benefits. See the proposed rule for more
information on these issues.
Comment: A commenter stated that current MYBE policy achieves a
balance between preserving the integrity of the bidding process and
providing enrollees with additional benefits at no extra costs.
Response: We believe that beneficiaries and the MA program in
general are best served by having a fair, competitive, and transparent
bidding process. By prohibiting MYBEs we believe that plans will have
more incentive to submit bids that reflect actual revenue needs.
Establishing a level playing field and preserving the integrity of the
competitive bidding process will be fair to plans and provide
beneficiaries with quality benefit packages with reasonable costs.
Comment: Three commenters recommended that CMS defer for a year
consideration of the policy to prohibit MYBEs. The commenters'
recommendation for this request ranged from the need to have more
experience with the bidding process, to the need to take into account
the fact that plans would have little experience with the bidding
process and, therefore, would need more time to make the transition to
the new process. One of the commenters requested that if CMS concludes
a new policy is needed, it should publish a new proposed rule.
Response: Based on these comments, we delayed publication of the
final rule, which we had proposed to implement beginning with the 2007
calendar year (CY). While the additional year of experience has been
helpful for us in assessing MYBEs, we believe that it confirms a longer
transition period will not be necessary (only one MA organization, for
example, applied for a MYBE in 2007). With respect to our other primary
concerns, we continue to estimate that MYBEs would likely lead to bids
as much as 2 to 3 percent higher than would be submitted if MYBEs were
prohibited, and that the competitive nature of the bidding process
would be undermined to both the detriment of beneficiaries and the MA
program if MYBEs were permitted even under the current limitations. We
also do not believe that there is any benefit to publishing another
proposed rule. Although this final rule updates some of our original
contentions, and clarifies our discussion of employer and union
sponsored group health plans and MYBEs, our concerns as well as our
means of addressing them remain unchanged as does the larger context
surrounding MYBEs and the MA program. We believe, therefore, that it is
important to proceed as indicated in the proposed rule so that we may
ensure that the bidding process is competitive, fair to all, and that
it continues to comply with the statute.
Comment: A commenter disagreed with our statement that there was
value
[[Page 43630]]
in making the MA MYBE policy consistent with the prescription drug
benefit program (which does not permit MYBEs). The commenter also
stated that the offering of basic or supplemental benefits in MA
programs often have separate requirements, and asked why this should
not be the case with respect to MYBEs and Part C and D benefits. In
other words, the commenter asked why would CMS prohibit MYBEs for MA
benefits simply because this is the case for Part D benefits.
Response: As we stated in the proposed rule, we do not believe that
non-prescription drug benefits should be treated differently than
prescription drug benefits. In many MA plans (known as MA-PDs),
beneficiaries also receive the Part D prescription drug benefit. (Under
our current guidance, in such cases beneficiaries could receive benefit
enhancements for health benefits midyear but no enhancements for the
Part D portion of the benefit.) By prohibiting MYBEs we will create
consistency in treatment of the Part C and D benefit components and
ensure that estimates of the revenue necessary for both is accurate. In
response to the comment that the sometimes different requirements
surrounding Part C basic and supplemental benefits would permit
different treatment of MA and Part D benefits, (that is, allow MYBEs
for MA plans but not for Part D plans), we believe that the different
requirements cited by the commenter would have little to do with the
question of MYBEs and their relation to bidding. Instead, the
prohibition on MYBEs is primarily due to our desire to ensure that bids
accurately represent the revenue needed whether for MA basic or
supplemental benefits.
B. Employer and Union Group Health Plans
In the January 28, 2005 final rule (70 FR 4639), we noted that
under the previous M+C program, we permitted M+C organizations to offer
MYBEs to existing benefit packages (that is, enhanced benefits, or
reductions in premiums or cost-sharing amounts). We also noted that
because employers and unions offering group health plans through an MA
organization may operate on different bidding and negotiation
timelines, MA organizations offering certain kinds of restricted
enrollment plans to employer and union group health plan sponsors would
be allowed to offer MYBEs on a flow basis and would not be subject to
the new restrictions on MYBEs. This exemption from the proposed MYBE
restriction included both the ``800-series'' employer and union-only
group health plans and the new type of employer and union group health
plan, where we directly contract with the employer or union sponsor
offering an MA product (both of these restricted enrollment employer-
only plans have since become known as employer and union-only group
waiver plans or ``EGWPs''). We noted that we did not believe the
competitive nature of the bidding process was affected if benefit
packages for these plans were adjusted midyear in accordance with our
guidance.
However, we noted that an MA organization would be subject to the
policy of restricted MYBEs if it is offering an employer or union group
health plan sponsor a plan that enrolls both individual beneficiaries
and employer or union group health plan members, (that is, a plan open
to general enrollment). For these latter plans, we also noted that
employers and unions would still be free to enhance benefits midyear
for the part of the group health plan benefit that is a ``wrap-around''
to the MA plan and that is only available to that employer or union
group health plan sponsor's members. Additionally, we noted that these
``wrap-around'' benefits are not technically part of the MA plan.
In the September 1, 2006 proposed rule (71 FR 52016), we noted that
there was no longer a need for an interim MYBE policy and applied the
same rule to ``800-series'' EGWPs that was proposed for all other MA
plans (with the exception of PACE plans). That is, we proposed that
beginning with CY 2007, all MA organizations, including organizations
offering MA plans to employer and union group health plan sponsors,
would not be permitted to make any midyear changes in benefits,
premiums or cost-sharing even under the circumstances in which these
types of changes were permitted in CY 2006. We proposed that this
policy apply to MA organizations that offer plans open to general
enrollment to employer and union group health plan sponsors and MA
organizations that offer restricted enrollment plans to employer and
union group health plan sponsors (that is, ``800 series'' EGWPs).
Comment: Two insurance trade associations commented that the
proposed rule should not apply to restricted enrollment MA plans. The
commenters stated that the proposed rule would severely limit the
longstanding flexibility for MA organizations and employers or unions
to negotiate benefits throughout the year that are responsive to the
needs and interests of these employer and union group health plan
sponsors and their members and thereby discourage employer and union
health plan sponsors from enrolling their members in MA plans. The
commenters also indicated that it is crucial for MA plans to be able to
accommodate the timing of arrangements with employers and unions that
offer ``800-series'' non-calendar year plans, and those ``800-series''
plans and/or contracts that begin midyear. For example, the commenters
stated that it would be extremely difficult for MA organizations that
must submit a bid by June of each year to anticipate the needs of
employers who have plan years that start in July of the following year
(for example, State and local governments).
Response: We agree that MA organizations should retain the
longstanding flexibility to customize benefits, including enhancing
benefits and reducing premiums and cost-sharing, for all ``800-series''
EGWPs in order to be able to accommodate the various needs of employer
and union group health plan sponsors throughout the year. The proposed
prohibition on MYBEs was not intended in any way to limit the current
flexibility that MA organizations have to negotiate customized benefit
designs for these ``800-series'' employer and union-only types of
plans. The proposed rule was merely intended to clarify that these
kinds of plans do not need to be exempted from the policy restricting
MYBEs because, due to their unique nature, they may continue to enhance
benefits for employer and union group health plan sponsors at any point
during the contract year without submitting MYBEs to CMS. Accordingly,
we are clarifying that MA organizations will retain the flexibility to
enhance benefits when offering these kinds of ``800-series'' employer
and union-only plans to employer and union group health plan sponsors
throughout the year despite being restricted from filing a formal MYBE
with CMS. Filing an MYBE is not necessary to exercise this flexibility.
Also, we are further clarifying that MA organizations will continue
to be able to accommodate different timing arrangements for different
employer or union group health plan sponsors by either contracting with
employers and unions on a non-calendar year basis or by entering into
new employer and union contracts midyear. MA organizations do not need
to file MYBEs to continue to negotiate with employers or unions to
provide enhanced benefits on a non-calendar year basis or to enter into
midyear contracts with employer and union group health plan sponsors.
Comment: One commenter expressed concern that the MYBE prohibition
may
[[Page 43631]]
cause employer and union group health plan sponsors to lose the ability
to incorporate Medicare in their benefits and thereby negatively affect
the ability to reduce health care costs and employers' access to
affordable health care.
Response: CMS' longstanding policy allowing enhancement of ``800
series'' EGWP plans for employer and union group health plan sponsors
throughout the year, as explained in response to the previous comment,
is not being modified by the proposed rule. We are clarifying that the
proposed rule does not limit the current flexibility for employer and
union group health plan sponsors to continue to contract with MA plans
to offer employment-based health coverage that incorporates Medicare
benefits (that is, ``800-series'' EGWPs) and thereby enhances the cost
effectiveness for employer and union health plan sponsors and the
retention of employment-based coverage.
IV. Provisions of the Final Regulations
We are finalizing, with the clarifications described in section
III, Analysis of and Responses to Public Comments, the policy specified
in the September 1, 2006 proposed rule (71 FR 52014-52017) and section
II, Provisions of the Proposed Rule. Beginning in contract year 2008,
MA organizations will no longer be permitted to offer midyear benefit
enhancements. As discussed in section III of this rule, employer and
union group health plans sponsors offering ``800 series'' MA plans will
continue to be able to offer benefit enhancements as they do currently,
through means other than MYBEs under existing CMS employer group waiver
policies. PACE plans are not affected by the prohibition.
We have had the opportunity to reevaluate our MYBE policy over the
course of the first 2 contract years of the new bidding process, and we
remain convinced that MYBEs are an obstacle to the statutory
requirement of a competitive bidding process and that there is no
longer a need for this interim policy. As stated in the proposed rule
on September 1, 2006, this policy was intended to assist MA
organizations during the initial phase of the new bidding process,
while ensuring that beneficiaries have a choice of plans. The lack of
MYBE applications support this conclusion as we had only one
application for a MYBE in CY 2007, and approximately six in CY 2006.
Under the new bidding process, the focus is, as it should be in a
competitive environment, on establishing a level playing field by
ensuring that the initial bidding process is not skewed by the
opportunity later in the year to adjust benefits and bids through
benefit enhancements. Prohibiting MYBEs will ensure that the focus is
squarely on the integrity of the bidding process established by
statute.
As indicated in the proposed rule, the rationales for our proposal
to prohibit MYBEs remain valid after another year of experience with
MYBEs and the bidding process. To summarize those concerns--
MA organizations, knowing that they could alter their
benefit packages after the bidding process was complete, could
misrepresent their actual costs (revenue requirements) to provide
benefits (overbid) and noncompetitively revise their benefit packages
later in the year, once competitors' benefits are known.
MYBEs offered in July or September of the contract year
could be offered primarily to attract individuals in their initial
coverage election period (ICEP). We believe that individuals are very
attractive to MA organizations because of their relatively low
utilization (they are new to the program and tend to be healthier) and
because of their numbers (nationally, over 200,000 individuals per
month ``age-in'' to Medicare).
We estimate that organizations planning on revising their
bids through MYBEs could overbid by as much as 2 to 3 percent in order
to distinguish themselves from other plans later in the year and
attract ICEP beneficiaries.
MYBEs encourage overbidding, and second, penalize MA
organizations that do not attempt to ``game the system'' and which
instead offer a bid that more accurately represents their costs to
offer benefits over the full course of a contract year.
MYBEs are not consistent with the Part D program (the Part
D program does not allow MYBEs).
Finally, based on our experience since permitting MYBEs under even
the current limited circumstances, we have found it difficult to
determine the credibility of ``excess'' profits an MA organization has
for a specific plan (on which MYBEs are based), since the assessment is
based only on a few months of incomplete utilization data that occur
between the beginning of the calendar year and the MYBE application
deadline. Therefore, based on comments received, we are accepting all
of the provisions as proposed.
V. Collection of Information Requirements
This document does not impose information collection and
recordkeeping requirements. Consequently, it need not be reviewed by
the Office of Management and Budget under the authority of the
Paperwork Reduction Act of 1995 (44 U.S.C. 35).
VI. Regulatory Impact Statement
We have examined the impact of this rule as required by Executive
Order 12866 (September 1993, Regulatory Planning and Review), the
Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354),
section 1102(b) of the Social Security Act, the Unfunded Mandates
Reform Act of 1995 (Pub. L. 104-4), and Executive Order 13132.
Executive Order 12866 directs agencies to assess all costs and
benefits of available regulatory alternatives and, if regulation is
necessary, to select regulatory approaches that maximize net benefits
(including potential economic, environmental, public health and safety
effects, distributive impacts, and equity). A regulatory impact
analysis (RIA) must be prepared for major rules with economically
significant effects ($100 million or more in any 1 year). This rule
does not reach the economic threshold and thus is not considered a
major rule.
The RFA requires agencies to analyze options for regulatory relief
of small businesses. For purposes of the RFA, small entities include
small businesses, nonprofit organizations, and small governmental
jurisdictions. Most hospitals and most other providers and suppliers
are small entities, either by nonprofit status or by having revenues of
$6 million to $29 million in any 1 year. Individuals and States are not
included in the definition of a small entity. The MA program, by having
both regional and local plans, provides an opportunity for health
insurance entities of all types and most sizes (but probably not below
the ``small'' insurance entity cutoff level defined by the SBA ($6
million), which is lower than appears viable for a comprehensive, risk-
bearing insurance plan) to participate. Therefore, we are not preparing
an analysis for the RFA because we have determined that this rule will
not have a significant economic impact on a substantial number of small
entities.
In addition, section 1102(b) of the Act requires us to prepare a
regulatory impact analysis if a rule may have a significant impact on
the operations of a substantial number of small rural hospitals. This
analysis must conform to the provisions of section 603 of the RFA. For
purposes of section 1102(b) of the Act, we define a small rural
hospital as a hospital that is located outside of a Metropolitan
Statistical Area and has fewer than 100 beds. We are not preparing an
analysis for section 1102(b)
[[Page 43632]]
of the Act because we have determined that this rule will not have a
significant impact on the operations of a substantial number of small
rural hospitals.
Section 202 of the Unfunded Mandates Reform Act of 1995 also
requires that agencies assess anticipated costs and benefits before
issuing any rule whose mandates require spending in any 1 year of $100
million in 1995 dollars, updated annually for inflation. That threshold
level is currently approximately $120 million. This rule will have no
consequential effect on State, local, or tribal governments or on the
private sector.
Executive Order 13132 establishes certain requirements that an
agency must meet when it promulgates a proposed rule (and subsequent
final rule) that imposes substantial direct requirement costs on State
and local governments, preempts State law, or otherwise has Federalism
implications. Since this regulation does not impose any costs on State
or local governments, the requirements of E.O. 13132 are not
applicable.
In accordance with the provisions of Executive Order 12866, this
regulation was reviewed by the Office of Management and Budget.
(Catalog of Federal Domestic Assistance Program No. 93.773,
Medicare--Hospital Insurance; and Program No. 93.774, Medicare--
Supplementary Medical Insurance Program)
Dated: January 10, 2008.
Kerry Weems,
Acting Administrator, Centers for Medicare & Medicaid Services.
Approved: March 12, 2008.
Michael O. Leavitt,
Secretary.
[FR Doc. E8-17056 Filed 7-25-08; 8:45 am]
BILLING CODE 4120-01-P
